I had a little tussle with a guy in the Bronson Street McDonald’s this morning. I was a tad grumpy, and the big fella said something that worked me into a lather.
All the newspapers are carrying stories about the report by economist Don Drummond that says Ontario has to make big cuts to spending and jack up user fees and utilities costs if Queen’s Park is serious about balancing the provincial budget.
My sparring partner, a hefty and unkempt guy, was hollering about the wonderful fiscal situation in Alberta. That province, he said, was “on the road to a balanced budget.”
I reminded him that Tory governments are always on the road to a balanced budget. They just never seem to get there.
Take the federal Tories. Except for one year, when the Tories had taken over from Paul Martin and hadn’t had a chance to work their fiscal magic, no Tory federal government has balanced the books since the days of John Diefenbaker.
The Clark government couldn’t do it, despite a big hike to the gasoline tax.
Mulroney and his finance minister, Michael Wilson — who was often praised as a Bay Street boy and a financial wizard — never balanced a budget and, in fact, doubled the national debt while in power from 1984 until 1993. Wilson was always a couple of budgets away, he’d say, from financial stability. But, like a bar that promises “free beer tomorrow,” he never delivered.
And yet, through the years, Tories have adopted the whines of their Republican counterparts in the States and moaned about “tax and spend” Liberals.
Which brings me back to my buddy at Micky Ds and our little chat.
“Oil,” says I, “is at the highest sustained level in human history. If Alberta can’t balance a budget with royalties from $100 oil, what happens when the price falls back to $50 or $20?” I reminded him that Tories are always on the road to a balanced budget, but never seem to deliver.
My sensible wife dragged me before we could go at it on the Heritage Fund, which is supposed to help Alberta adjust to life after oil. Yes, there are a few billion in the fund, but for Alberta to cope in the post-oil world, it will need millions of new jobs in some kind of productive work. Most of the work force will have to be re-trained, and a lot of new infrastructure will need to be built.
There’s $15.4 billion in the Heritage Fund. It sounds like a lot of money, but it’s not enough to even begin to remake — and save — the economy of Alberta when the oil boom is over.
There’s a reason why Tories like deficits. It gives them the excuse they need to go after public sector workers, students, non-government organizers, and other people they don’t like. They get to cut social services and screw over the poor.
And, if there’s a recession, they get to help out their corporate pals with tax cuts, interest-free loans, and other goodies.
As we head into a round of Tory cuts to federal programs, we can expect them to engage in class warfare against middle-class, unionized government employees and the “undeserving” poor. To some, they’ll look like prudent fiscal mangers.
But to people who can read a balance sheet, they’ll likely still be less than zeroes.